Understanding the President's Budget Request (PBR), Congressional Budget Resolution, Budget Reconciliation, and Appropriations

The President's Budget Request (PBR)
● Kicks off the annual federal budget process.
● Supposed to be released the first Monday in February, but doesn’t always happen (like the first year of a new administration)
● PBR plays 3 key roles:
○ It conveys the President’s budget priorities for overall fiscal policy: how much money the federal government should tax and spend (and relatedly, deficits or surpluses)
○ Specifics about spending priorities, program by program, with lots of detail
○ Proposals to make changes to mandatory programs and tax policy
■ Likely this year: extension of Trump tax cuts, block granting Medicaid, and more

The Congressional Budget Resolution
● Congress’s own budget plan, drafted by House and Senate Budget Committees
● It’s in effect when House and Senate pass the same measure; it doesn’t get signed by the President.
● Can’t be filibustered.
● Sets top line target spending levels for committees (302(a) levels) in broad categories, as well as how much revenue the government should collect.
○ Appropriations committees get one 302(a) allocation number, as do committees with mandatory programs
● It can also establish an expedited process for action on mandatory spending and tax changes, known as “reconciliation.”
● Timing: Supposed to pass by April 15 but often takes longer, or not at all.
● Enforcement: A single member can raise a point of order against legislation that violates the limits set in the budget resolution. The House can get around it procedurally, but in the Senate, it requires 60 votes
to waive.

● If the House and Senate can’t agree on a budget resolution, each chamber passes its own, called a “deeming resolution.”

The Budget Reconciliation Process
● Optional procedure to expedite consideration of spending and tax legislation.
○ Senate rules for consideration of reconciliation bills include: the filibuster is prohibited, debate is limited to 20 hours, and amendments are limited.
● To start reconciliation, the House and Senate must pass a budget resolution that includes a “reconciliation directive” for committees to meet certain spending or tax targets.
● Limited to spending changes in mandatory programs and tax policy.
○ However, in 2021, additional funding for discretionary programs was also included, bypassing appropriations committees.
● Byrd Rule: Point of order against any provision that’s “extraneous” to amending spending or tax law, making it difficult to include policy changes that don’t have a direct fiscal implication.
● The procedural advantages to budget reconciliation are huge, and therefore Congress has increasingly used it to enact major spending and tax changes. In recent decades, the most likely reason for Congress
to proceed with a budget resolution at all is to trigger the reconciliation process; if a reconciliation bill is not envisioned, Congress is likely to forgo a budget resolution entirely.

Appropriations
● Once the budget resolution (or deeming resolution) establishes the “top-line” or 302(a) number for the appropriations committees, that top line number must be divided up among the 12 appropriations
subcommittees. This allocation is called the 302(b) number.
● The appropriations process is for discretionary accounts, which includes Head Start. Programs that receive mandatory funding, like Medicaid, are not funded through annual appropriations.
● The federal fiscal year starts on October 1. If – as has become the norm over the past decade – appropriations bills are not signed by then, the government must shut down. Continuing Resolutions
(CR) are used to keep the government opening temporarily, usually at flat-funding levels, until a final appropriations agreement can be made.

Source: Center on Budget and Policy Priorities explainer